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U.S. Army Lt. Carl Estinek was awoken on a Saturday morning by a telemarketer offering a pretty good deal. A guaranteed low-interest credit card, as long as he put up a $187 advance fee. His credit was spotty because of a prior divorce, and he had trouble getting credit cards. The only ones he qualified for charged high annual fees and interest rates. So, after 45 minutes of skeptical questioning, Estinek forked over his debit card number.

But he never received the credit card. Instead, Carl became another victim in what the Federal Trade Commission calls the nation's No. 1 scam — so-called "advance-fee" loans. Nearly 4.5 million people each year fall for the ploy, the FTC says. Most of them, like Estinek, have bad credit. The offer of inexpensive loans or credit cards, tied to a small up-front fee, is often proves too tempting for those on the edges of America's credit system.

Charging an up-front fee for a loan is illegal in the United States, according to the FTC.

Estinek, who's based in Dixon, Mo., at Fort Leonard Wood, was duped by a Toronto-based firm named Prime One Financial, according to the FTC. On Tuesday, the agency announced it had sued the firm, accusing it of bilking $10 million from American consumers. The firms' assets have been frozen by a court order, pending additional legal action.

While he was scammed out of less than $200, the hassle didn't stop there. In his quest or a refund, Estinek spent $60-$70 in international phone calls. Then, he spent endless hours following up with an alphabet soup of state, federal, and Canadian authorities.

"It's a part-time job trying to track this stuff down when you are a victim," he said. "It becomes a real hassle."

Most victims don't report the crime
FTC officials said they were lucky Estinek was persistent. Most victims — up to 95 percent, the agency said — don't come forward, allowing the con artists to continue to operate.

Video: Credit card scam
International scam operations, often originating in Canada, are big business. Boiler rooms full of telemarketers in Toronto, Montreal, and Vancouver bilk thousands of Americans each month out of millions of dollars using a variety of scams. Phonebusters, a cooperative effort between U.S. and Canadian law enforcement agencies, estimates phone fraud to be a $1 billion a year business now. The FBI estimates that U.S. citizens send $100 million each year to Canadian con artists.

"The message here is clear," said Deborah Platt Majoras, chairman of the FTC. "Fraud is going global at a rapid pace." The FTC has an ongoing project with several Canadian agencies in an attempt to stem the fraud, and inform the public.

"If we get convictions, the penalties in the U.S. are 10 times greater than they are in Canada," he said.

While Estinek's ordeal began with a telemarketing call, the con artists often find victims by advertising in U.S.-based newspapers. The ads might sound familiar. A typical one reads: "Living paycheck to paycheck? If you have bad credit, good credit, or even claimed bankruptcy, we are here to help you. Call toll free."

The FTC on Tuesday warned newspapers around the country to be on the lookout for such advertisements, and suggested classified departments call the U.S. Postal Inspection Service's Criminal Investigations Service with questions. Generally, officials said, fake ads are placed with stolen credit card numbers, a non-existent mailing address, and a toll-free number that is based in Canada.